PRMS #23

Professional Standards Orientation Package for New Lawyers

MEMORANDUM

TO:

FROM: [insert name]

RE: Firm Professional Standards and Loss Prevention Program

DATE:

Welcome to the Firm ("Firm"). On behalf of Managing Partner xxx, and as Professional Standards and Loss Prevention Partner ("Loss Prevention Partner") for the firm, I want to take this opportunity to provide you with some information regarding the firm’s professional standards and loss prevention program.

The goal of the program is three-fold:

1. First and foremost, to facilitate the firm’s acceptance and performance of client representations in full compliance with the letter and spirit of the applicable rules of professional conduct, including providing guidance in quickly and amicably resolving conflict issues.

2. To avoid legal malpractice claims against the firm to the degree possible by:

a. Educating firm lawyers regarding their responsibilities to clients and the profession;

b. Providing easy access to experienced loss prevention personnel who can help identify and resolve professional responsibility issues before they become problems; and

c. Establishing and enforcing effective loss prevention policies and procedures to minimize opportunities for clients to legitimately make a claim against the firm or firm lawyers for failure to discharge their professional responsibilities.

3. If a claim is made, to manage the claim, in cooperation with our professional liability insurance carriers, in a manner that will minimize the cost to the firm in terms of dollars and damage to reputation.

PRMS #23 - Professional Standards Orientation Package for New Lawyers – Law Firm 1 The cornerstone of our loss prevention program is our commitment to professional responsibility, client service and quality performance provided through the “one firm” concept. A copy of the Firm Commitment, which explains these values, is attached.

The firm’s professional liability insurance carriers are underwriters who write insurance through the Lloyd’s, London, U.S. and Bermuda markets. Our policy is a claims-made errors and omissions indemnity policy, the effectiveness of which depends upon the firm’s prompt reporting of claims. Our current policy period runs through September 6, xxxx, and will be renewed thereafter. Our annual coverage limits are $______per claim and $______in the aggregate, and our self-insured retention is $______per claim, up to an annual aggregate of $______. What this means is that the firm is liable for up to $______in judgments, settlements, attorneys’ fees and other costs in any one claim against the firm in a given policy year before our Lloyd’s coverage kicks in, but no more than $______in the annual aggregate for all claims. Once the aggregate amount of $______has been paid by the firm, then the retention on all claims thereafter is limited to $______.

Under our policy, claims against the firm must be reported to xxx (“xxx”), the U.S. representative of the underwriters. Our underwriters expect the Firm promptly to report claims to xxx, to provide regular status reports to xxx, and to involve xxx in significant decisions regarding the defense against and/or settlement of claims. Because the possibility exists for xxx to represent an adverse party, or to represent any one of our underwriters as the insurer of an adverse party, in litigation that involves or gives rise to a professional liability claim against the Firm, we have in place special security measures to avoid disclosing anything to xxx that could prejudice our interests.

The Firm has formally adopted a Claims Counsel Policy that was designed to ensure better coordination in claims reporting and management and to increase the likelihood that internal communications directed by or through the Claims Counsel will enjoy the benefit of the attorney-client privilege or work product protection from disclosure. In accordance with the Claims Counsel Policy, we have also published directives regarding the definition and management of claims. Copies of the Policy and Directives are attached for your review. I ask that you pay particular attention to the Directives, which define the events and situations that we consider to be claims for reporting purposes and which specify actions that require Claims Counsel or Assistant Claims Counsel approval.

We have a network of lawyers and staff members throughout the firm who are involved in the implementation of the professional standards and loss prevention program, and a list of those persons, their office locations, and telephone extensions is attached. Briefly, in addition to serving as the firm's Loss Prevention Partner, I am also its Claims Counsel, and I am responsible for professional standards, loss prevention and claims management for the firm. All claims and circumstances must be promptly reported to the assistant claims counsel in the office in which the problem arises, and the assistant claims counsel must promptly report the matter to me.

In addition, there are:

PRMS #23 - Professional Standards Orientation Package for New Lawyers – Law Firm 1 - xxxx (Ext. ____). As the Ethics and Conflicts Counsel for the firm, xxx specializes in the educational aspects of our Loss Prevention Program, including providing loss prevention orientations to new lawyers in the firm and firmwide seminars regarding significant loss prevention issues. In addition, she is available to address questions regarding issues of professional responsibility and to assist in the resolution of complex conflicts of interest. Xxx should be consulted after conflicts are determined by the local assistant claims counsel to require implementation of an ethics wall, or to assist in determining whether an ethics wall is advisable or necessary. She has the responsibility and authority for drafting and/or approving the form of ethics walls and for distributing them on a firmwide or less inclusive basis, as appropriate.

- Assistant claims counsel. Assistant claims counsel are appointed for each Firm office (or, in some instances, one assistant claims counsel will serve more than one office), and they are the backbone of the Firm’s claims management and loss prevention program. Their most significant responsibility is to receive reports of claims and potential claims against the firm and to manage those claims, at least in the initial stages, under my direction. In addition, they provide experienced assistance in evaluating and resolving conflicts and other loss prevention issues at the local office level. ______is the assistant claims counsel for the ______office, and he can be reached at Ext. _____.

- xxx (Ext. ____). xxxx serves as the firm’s loss prevention administrator. She is available to receive notices and reports regarding claims and circumstances and is responsible, with me, for notifying xxx of claims and keeping it advised regarding their status. She is the best source of information on policies, procedures, personnel or other resources regarding the firm’s loss prevention program. You should feel free to talk to her regarding any matter. xxx and other members of the loss prevention team in Tallahassee are assisted by xxx (Ext. ____) who provides secretarial and other support services.

- Conflict Analysts. The firm has four conflict analysts, whose sole task is to review conflict search reports to identify and assess actual and/or potential conflicts of interest associated with new business intake and the recruiting and hiring of lateral entry lawyers and non-lawyer staff. Once a conflict analyst has identified a conflict, it is then referred to the appropriate lawyer for resolution. By performing this preliminary review of the conflict search reports, the conflict analysts are able significantly to reduce the time our lawyers must spend on conflict matters, away from client service. Our conflict analysts and the offices for which they are responsible are:

[insert names and offices]

If you need assistance from a conflict analyst, please contact xxx at Ext. ____.

Of course, the most important member of our loss prevention team is YOU. The firm’s successful discharge of its professional responsibilities to clients is totally dependent upon the diligence, knowledge and high professional standards of each of us. The mission of the loss prevention staff is to make sure you have the resources and assistance you need to do your job.

PRMS #23 - Professional Standards Orientation Package for New Lawyers – Law Firm 1 Finally, because we believe that the exercise of proper client intake procedures is the best means of reducing malpractice risks, I am enclosing the following materials for your review and use:

- Information regarding issues that should be considered when determining whether to accept a new client or a new matter for an existing client. The questions recommended for consideration here should be considered by every Firm lawyer involved in the intake process.

- Firm new matter memorandum, which must be completed for every new matter opened, including new matters for existing clients. It is essential that lawyers completing new matter memoranda provide detailed and accurate information. This means that they must provide full and accurate names of the prospective client, adverse parties and related parties, including opposing counsel if known, and that they must provide a detailed description of the scope of engagement that fully and accurately reflects what the engagement will include and, if appropriate, what it will not. The information the responsible lawyer provides on the new matter memorandum is the information that is recorded on the firm’s conflict data base, which later appears on conflict search reports and is used to identify potential conflicts of interest. Finally, the new matter memorandum must be updated in a timely manner when there are changes in the parties, relationships or other matters affecting conflict determination.

Conflicts of interest constitute the Firm’s most significant loss prevention problem, and extreme care must be taken by each of us to discharge our individual responsibilities with respect to the avoidance of conflicts. As explained above, it is necessary that complete and accurate information be provided on the new matter memorandum. Then, once a conflict check is run and produces a conflict search report, it is your personal responsibility to review the resulting conflict search report to identify past, present or prospective representations that might create a conflict if the new representation is accepted. You must also communicate directly with lawyers identified on the conflict search report as having responsibility for those past, present or prospective representations to determine their status, nature and other information necessary to evaluate the conflict. Please do not ask your secretary or legal assistant to assume these responsibilities.

For your information, when conflict checks are run in connection with the opening of a new file, they are run in a manner that will leave a record on the conflict data base. This is done so that in the interim between the first contact with the prospective client and the time a new file is officially opened for the client, there is a record that, when printed on the conflict search report (as a “prospective” hit), will put other lawyers on notice that a representation may exist which would prohibit the acceptance of another representation in which the parties involved are the same as in a past or present representation but occupy adverse positions. Therefore, a lawyer’s responsibility to identify and resolve conflicts before accepting a new representation requires that lawyer to communicate directly with other lawyers who are identified on the conflict search report as having previously run a conflict check on an individual or entity that would be involved (as a client, adverse party, etc.) in the new representation. The discharge of this particular responsibility is critical, and failure to discharge it can result in a conflict of interest involving the firm’s simultaneous or subsequent representation of clients adverse to each other.

PRMS #23 - Professional Standards Orientation Package for New Lawyers – Law Firm 1 For your information and convenience, I am attaching former Professional Standards Partner xxx's memorandum to all lawyers outlining procedures to be followed in identifying and resolving a conflict of interest. Please take time to understand your responsibilities and do not fail in the duty of stewardship that you owe to the firm in this regard. If you have questions regarding the procedures or the interpretation of information provided on conflict printouts, please seek help from the assistant claims counsel in your office, or from xxx (Ext. ____) or me (Ext. ____).

A final word on conflicts - make sure you know all the facts and are certain there is a conflict before you seek a conflict waiver from a client. Client relations problems that can be as harmful to the firm as an ethical conflict can be created where we ask for a waiver we do not need and then are not willing to accede to the client’s demand that we not take on the other matter.

- The Firm’s standard form engagement letter and accompanying terms of engagement. Recent experience has demonstrated the necessity, in engagement letters, not only of setting forth fee information, but describing in detail the scope of the engagement, specifically identifying the entity or individual that is the client, specifically disclaiming representation of related entities or individuals, if appropriate, and explaining the modification of the firm’s normal responsibilities that apply in joint representations of two or more clients. Please do not depart from the standard form engagement letter and terms of engagement, which may be found online on the WORD template in each office.

- The Firm’s policy regarding the exclusive representation of clients. The firm has adopted a policy that prohibits making a commitment to a client to represent it to the exclusion of other clients without the advance approval of the managing partner.

- The Firm's policy regarding agreeing to treat a client's affiliates as clients for conflict purposes. The Firm developed a policy and protocol for responding to a client's request/demand that the firm treat its affiliates as clients for conflict purposes.

[Include this paragraph in associate and other non-partner packages.] We have included these materials for your information and because we believe it is important for all of our lawyers to understand the client intake process. Please note, however, that current firm policy requires that new matters be opened and engagement letters be signed by partners only.

I hope you will take the time to review all the referenced materials and to call me or other members of the loss prevention team if you have any questions.

PRMS #23 - Professional Standards Orientation Package for New Lawyers – Law Firm 1